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The U.S. Treasury Department says none of its major trading partners manipulate exchange rates, to gain unfair competitive advantage in international trade. It also welcomed China's exchange rate policy shift, calling it a "significant development."
China announced in June a decision to proceed further with the reform of the exchange rate regime, to enhance the flexibility of the yuan.
The Treasury's semi-annual currency report was originally due on April 15th. It examines whether a country is manipulating its currency "for purposes of preventing effective balance of payments adjustments, or gaining unfair competitive trade advantage in international law."
A finding of currency manipulation could trigger negotiations, leading to possible trade sanctions against the offending country.
- Yuan mid-point at 6.7753 2010-07-09